RBA governor’s frank message on the economy is the biggest shock

RBA governor Michele Bullock talks to the media in Sydney on Tuesday after the decision to increase interest rates for the third time this year. Photograph: Dean Lewins/AAP

The Reserve Bank of Australia has delivered its third rise in official interest rates for the year, taking the cash rate up another 0.25 percentage points to 4.35%, and thereby completely reversing the cuts of 2025.

While some make take comfort from the RBA governor’s words in her post-decision press conference that indicated that we could now expect a pause in rate hikes for at least a little while, her overall responses to questions from the media were surprisingly blunt, as well as fairly alarming regarding the economic outlook.